Form CR-1216 "Kansas Business Tax Application Packet" - Kansas

What Is Form CR-1216?

This is a legal form that was released by the Kansas Department of Revenue - a government authority operating within Kansas. As of today, no separate filing guidelines for the form are provided by the issuing department.

Form Details:

  • Released on February 1, 2019;
  • The latest edition provided by the Kansas Department of Revenue;
  • Easy to use and ready to print;
  • Quick to customize;
  • Compatible with most PDF-viewing applications;
  • Fill out the form in our online filing application.

Download a fillable version of Form CR-1216 by clicking the link below or browse more documents and templates provided by the Kansas Department of Revenue.

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Download Form CR-1216 "Kansas Business Tax Application Packet" - Kansas

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B
T
usiness
ax
A
pplication
Welcome to
The Kansas business community!
IMPORTANT: Effective April
1, 2019 CMB permit holders will
be allowed to sell beer not more
than 6% alcohol by volume in
addition to CMB. For additional
information see Notice 18-04.
ksrevenue.org
Pub KS-1216
(Rev. 2-19)
B
T
usiness
ax
A
pplication
Welcome to
The Kansas business community!
IMPORTANT: Effective April
1, 2019 CMB permit holders will
be allowed to sell beer not more
than 6% alcohol by volume in
addition to CMB. For additional
information see Notice 18-04.
ksrevenue.org
Pub KS-1216
(Rev. 2-19)
TABLE OF CONTENTS
GETTING STARTED . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
AFTER YOU APPLY . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Choosing a Business Structure
Your Certificate of Registration
Record Keeping
Filing Tax Returns
Certificate of Tax Clearance
Reporting Business Changes
Accounting Methods
ELECTRONIC FILE AND PAY OPTIONS . . . . . . . . . . 13
COMPLETING THE BUSINESS TAX APPLICATION . . 3
When and How to Apply
OTHER EMPLOYER REQUIREMENTS . . . . . . . . . . . . 13
General Instructions
Employer Identification Number (EIN)
Specific Line Instructions
Kansas Unemployment Tax
Application Checklist
Workers Compensation
Required Bonds and Fees
BUSINESS TAX APPLICATION (FORM CR-16) . . . . . 7
RESOURCE DIRECTORY . . . . . . . . . . . . . . . . . . . . . . 14
REGISTRATION SCHEDULE FOR ADDITIONAL
BUSINESS LOCATIONS (Form CR-17) . . . . . . . . . . . 11
ASSISTANCE . . . . . . . . . . . . . . . . . . . . . . BACK COVER
The information in this booklet is intended as a general guide and does not cover all provisions of the law. If there is a conflict between the law and
information found in this publication, the law remains the final authority. Under no circumstances should the contents of this publication be used
to set or sustain a technical legal position. A library of current policy information is also available on our website:
ksrevenue.org
also have additional reporting and registration obligations
to the Secretary of State.
GETTING STARTED
• S CORPORATION. S corporations are generally not
taxable entities. Shareholders include their share of the
S corporation’s income (or loss) on their personal income
tax return.
CHOOSING A BUSINESS STRUCTURE
• LIMITED LIABILITY COMPANY. The Limited Liability
Company (LLC) is a business owned by one or more
members. It has some aspects of a partnership and
An important step in starting a business is to select the
some of a corporation. Business income from a limited
type of business structure or organization you will use.
liability company may be taxed as a corporation or as a
The organization of a business defines the ownership and
partnership. Limited liability companies must register with
responsibilities of the owner(s) and each type has advantages,
the Secretary of State.
disadvantages and tax consequences you should be aware
• OTHER. Includes estates, business trusts, personal trusts,
of before making a final decision. You may wish to consult a
unincorporated organizations or associations.
tax practitioner (accountant, enrolled agent, attorney, etc.) or
one of the agencies listed in the Resource Directory on page
RECORD KEEPING
14 for information that can assist you in establishing your
business structure. The following are the most common types
of a business organization.
Good record keeping is essential to the success of any
business, and is a necessary part of your compliance with state
• SOLE PROPRIETORSHIP. A sole proprietorship is a
and federal tax laws. The type and complexity of the records
business owned and operated directly by one person. This
is the simplest and most common form of small business
you keep depend entirely on the nature of your business
organization. Income earned by the business is reported on
and the amount of detail required. No matter how simple or
the owner’s individual income tax return. Sole proprietors
complex, your records must be accurate, neat, and detail
may need to make estimated tax payments because
all aspects of your business operation. Keep your business
income taxes are not withheld from their business income.
records separate from your personal financial records. If you
A sole proprietor is not an employee of the business.
own more than one business, each should have its own set
• GENERAL PARTNERSHIP. A partnership is a business
of books. You should maintain your records for your current
owned by two or more persons. Each partner contributes
year of business and at least three prior years.
money, property, labor or skills, and each shares in the
profits, losses, and debts. A partnership is not a taxable
CERTIFICATE OF TAX CLEARANCE
entity. Each partner must include his or her share of income
(or loss) from the partnership on his or her personal income
Business owners are required to meet certain obligations
tax return. Like sole proprietors, personal income taxes
under Kansas law, including filing timely tax returns with
are usually not withheld for the partners and estimated tax
payments may be required.
full payment. As a successor of a business, you may be
responsible for tax debts incurred by the previous owner of
• C CORPORATION. A corporation is a legal entity created
the business. You can be released of that obligation when the
under state or federal law with an existence separate and
previous owner produces a tax clearance certificate or letter
apart from its members or stakeholders. Corporations
from the Kansas Department of Revenue (KDOR) stating that
report business income on a corporate income tax return,
and may need to file estimated tax payments. Corporations
no taxes are due.
2
A tax clearance is a comprehensive review of an entity’s
This will ensure that your tax account number and registration
account to determine if it is in compliance with all applicable
certificate are issued before your first tax payment is due.
Kansas tax laws, taxes, fees, and payments administered by
the Department of Revenue and other Kansas state agencies.
GENERAL INSTRUCTIONS
A tax clearance certificate or letter provides an official
statement as to the results of an account review done by the
Use the Business Tax Application (CR-16) to obtain a
Department of Revenue. Tax clearance results do not clear you
registration number or license to collect and electronically remit
of any liabilities, but rather is stating that you, or the business,
most of the business taxes administered by the Department
is in current good standing with the Department of Revenue.
of Revenue. To register more than one location, complete
To apply for a tax clearance, log on to the Department
a Kansas Registration Schedule for Additional Business
of Revenue website (ksrevenue.org) and click the Tax
Locations (CR-17) for each location.
Clearance Information link. You will be asked to provide
Form CR-16 (page 7) has twelve parts. Please type or
identifying information and answer some questions. Upon
print all answers, using black or blue ink only. All applicants
submission you will be issued a Transaction ID. It is important
must complete PARTS 1, 2, 3, 4 and 12. Follow the line-by-
that you retain this ID, as you will need it to retrieve your “tax
line instructions to complete an accurate application. Answer
clearance status” the following business day.
questions that do not apply to your business with “N/A” for
“Not Applicable.” Incomplete applications will be returned.
ACCOUNTING METHODS
SPECIFIC LINE INSTRUCTIONS
Accounting methods are ways of recording income and
expenses. There are two accepted methods of accounting –
PART 1 – REASON FOR APPLICATION
cash basis and accrual basis.
• Cash basis accounting reports income in the period
You will mark only one box in this section. Do not enter N/A.
received and expenses in the period paid.
(If you are currently registered and are just adding another
• Accrual basis accounting reports income when earned
business location, do not complete Form CR-16; instead
(regardless of when payment is received), and expenses
complete only Form CR-17 – see page 11.)
when incurred (regardless of when paid).
– Registering for additional tax types . Mark this box if
The method you select depends on the nature and
the business is currently registered for one or more tax types
complexity of your business and the amount of detail you
and you are requesting registration for additional tax type(s).
need to make business and financial decisions. Choose
– Started a new business . Mark this box if you are
the method that fits your business and provides you with
registering a new business. Do not mark it if you already have
a complete, accurate and understandable picture of your
a registration and are adding another location or tax type.
financial condition. The method chosen must be the same for
– Purchased an existing business . Mark this box if you
the Department of Revenue and the Internal Revenue Service
have purchased a business from another owner. In the
(IRS). Important—once established, you may not change
spaces provided, enter the federal Employer ID Number
accounting methods without prior written approval from the
(EIN) of that previous business owner.
IRS and/or the Department of Revenue.
PART 2 – TAX TYPE
COMPLETING THE
Mark the box beside ALL the business taxes you are applying
for and complete the required parts of the application listed
BUSINESS TAX APPLICATION
for that registration/license. Use the following descriptions to
make sure you register for all the taxes and licenses required.
– Retailers’ Sales Tax. Engaged in selling tangible personal
WHEN AND HOW TO APPLY
property or providing taxable services to the end user.
Kansas imposes a state retailers’ sales tax of 6.5% plus
You should begin the application process 3 to 4 weeks prior
local sales taxes on the 1) retail sale, rental or lease of tangible
to your start date. For example, if you plan to open on January
personal property; 2) labor services to install, apply, repair,
1, then complete an application no later than December 1.
service, alter, or maintain tangible personal property; and, 3)
Applications are accepted online, by mail, by fax, or in person.
admission to places that provides entertainment, amusement,
For online registration, visit
ksrevenue.org
and sign in to
or recreation in Kansas.
the KDOR Customer Service Center. After you complete the
A retail sale is an exchange of tangible personal property
application you will receive a confirmation number for your
(goods, wares, merchandise, products and commodities)
registration and account number(s).
for money or some other consideration to the final user or
consumer. Examples of taxable services include auto repair;
If you prefer, you may apply in person – it provides same-
painting, wallpapering or remodeling a commercial building;
day registration service. An owner, partner, or a principal officer
washing and waxing of vehicles; and pet grooming.
(president, vice-president, or secretary-treasurer) may bring the
completed application to our assistance center. We will process
A city and/or a county in Kansas may levy a local sales
your application, assign a registration number, and issue a
tax, ranging from .10% to 3%. Kansas retailers are required
Certificate of Registration if you have no outstanding tax liability.
to collect the combined state and local rate in effect where
the customer takes delivery of the merchandise or where the
Another option is to mail or fax your completed business tax
taxable service is performed.
application to our office 3-4 weeks prior to making retail sales.
3
W
. If you are a wholesaler (all of your sales are
lodgings, or other sleeping accommodations. The guest tax
holesalers
to retailers for resale or to other wholesalers), you do not need
applies when there are more than two bedrooms furnished for
a sales tax number. A wholesaler will purchase its inventory
the accommodation of guests and the room is rented for 28
using a Multi-Jurisdiction Exemption Certificate (ST-28M)
consecutive days or less. Contact the city or county clerk for
available from the department’s website.
the rate in your area.
C
. Contractors who pay sales or use tax on
– Tire Excise Tax . Engaged in the retail sale of new tires or
ontraCtors
their materials and supplies and who work exclusively on
new vehicles.
residential property generally do not need a sales tax number.
A tire excise tax of 25 cents per tire is due on new tires sold
Contractors who perform work on commercial property or on
for vehicles authorized or allowed to operate on public streets
both commercial and residential property, and contractor/
and highways. New tires include the tires on a new vehicle sold
retailers who maintain an inventory of materials that they sell
for the first time. Used, recapped, and retreaded tires are not
at retail without installing, must obtain a Kansas sales tax
subject to the tire excise tax.
number in order to report the tax collected on taxable services
– Vehicle Rental Excise Tax . Engaged in the rental of motor
and over-the-counter sales.
vehicles.
– Retailers’ Compensating Use Tax . Out-of-state vendor
Kansas imposes a 3.5% vehicle rental excise tax on the
selling tangible personal property to Kansas customers.
rental or lease of a motor vehicle for 28 consecutive days or
Out-of-state retailers of tangible personal property who meet
less. This excise tax is in addition to the state and local retailers’
certain guidelines must collect and remit the state and local
sales tax.
Retailers’ Compensating Use Tax from their Kansas customers.
– Dry Cleaning Environmental Surcharge . Engaged in
Examples include maintaining a Kansas sales office or delivering
the laundering and dry cleaning of garments and household
merchandise to Kansas customers using company vehicles. The
fabrics.
rate of tax due is equal to the state and local sales tax rate in effect
The dry cleaning environmental surcharge is 2.5% of the
where the Kansas customer takes delivery of the merchandise.
gross receipts received from dry cleaning or laundering services.
– Consumers’ Compensating Use Tax . Purchase of
The surcharge is in addition to the state and local retailers’ sales
tangible personal property from outside Kansas for use,
tax. A fee is also imposed on the sale of dry cleaning solvents
storage or consumption in Kansas on which a sales tax
(chlorinated and petroleum-based) by solvent distributors.
equal to the state and local sales tax rate in effect where
– Liquor Enforcement Tax . Engaged in the sale of alcoholic
the Kansas buyer takes delivery has not been paid.
liquor for consumption off the premises.
Individuals and businesses who buy goods from outside
Kansas for their consumption, use or storage (not resale) may
Kansas imposes an 8% liquor enforcement tax on
be subject to a compensating use tax. Imposed since 1937,
alcoholic liquor sold by retail liquor stores, microbreweries,
Kansas consumers must pay this state and local use tax when
microdistilleries, farm wineries or farm winery outlets to
buying items from catalogs, mail-order retailers and others if
Kansas consumers, and alcoholic liquor and cereal malt
no sales tax is charged, or if the sales tax paid is less than the
beverages sold by distributors to Kansas clubs, caterers, or
combined state and local Kansas tax rate in effect where the
drinking establishments. A retail liquor store, microbrewery,
Kansas buyer takes delivery. If the sales tax paid in the other
microdistillery, farm winery, farm winery outlet distributor, or
state is less than Kansas combined rate, the Kansas use tax
special order shipper must also have a liquor license issued by
is the difference between the two rates.
KDOR’s Division of Alcoholic Beverage Control (785-296-7015).
– Withholding Tax . Deducted from wages, taxable non-wage
If selling other goods and services other than alcoholic and
payments and distributions by employers and payers.
ceral malt beverages, the business must register for and collect
Retailers’ Sales Tax.
You must withhold Kansas tax if the recipient is a resident
of Kansas, performing services inside or outside of Kansas or
Effective April 1, 2019 CMB permit holders will be allowed
receiving other taxable payments on which federal withholding
to sell beer not more than 6% alcohol by volume in addition
is required; OR a nonresident of Kansas, performing services
to CMB. These CMB permit holders will collect the applicable
in Kansas. If federal income tax withholding is required on a
state and local sales tax on the sale of both CMB and beer.
payment, Kansas withholding is also required (see page 8).
Retail liquor stores that sell beer will continue to collect the
8% liquor enforcement tax on those sales of beer. Other
– Corporate Income Tax . Corporation engaged in business
goods or services sold by a retail liquor store on their licensed
in Kansas or receiving income from Kansas sources.
premises (excluding the sale of lottery tickets) will be subject
Corporate income tax is assessed against every corporation
to state and local sales tax which includes the sale of cereal
doing business in Kansas or deriving income from sources
malt beverage. For additional information see Notice 18-04.
within Kansas. The corporate income tax consists of two rates:
the normal tax is 4% of taxable income, and a surtax of 3% on
– Liquor Drink Tax . Engaged in the retail sale of alcoholic
taxable income over $50,000.
liquor for consumption on the premises.
– Privilege Tax . Income tax paid on the net earnings of every
Kansas imposes a 10% liquor drink tax on the sale of
drinks containing alcoholic liquor by clubs, caterers, or drinking
bank, trust company, national banking association, federally
establishments. A club, caterer, or drinking establishment
chartered savings bank, and savings and loan association.
(including farm wineries, microbreweries, or microdistilleries
The privilege tax consists of two rates: the normal tax is
selling to customers for on-premises consumption if they
2.25% of net income; the surtax is 2.125% for banks and 2.25%
possess a drinking establishment license) must also:
for savings and loans, trust companies, and federally chartered
• have a liquor license issued by the Division of Alcoholic
savings banks.
Beverage Control, 785-296-7015;
– Transient Guest Tax . Engaged in the rental of hotel or
• have a Kansas retailers’ sales tax number; and
motel rooms.
• post a bond of $1,000 or three months average liquor drink
Some Kansas cities and counties impose a transient
tax liability, whichever is greater.
guest tax (in addition to the sales tax) on the rental of rooms,
4
– Cigarette Vending Machine License and Permit .
Articles of Incorporation.
Operators’ master license and permit for owners of cigarette
LINE 3: Enter the mailing address of the business.
vending machine(s).
LINE 4: Enter the business telephone number and fax number.
Each cigarette vending machine in Kansas must have a
LINE 5: Enter the name and telephone number of the person
permit. Permits are $25 per machine and must be renewed
to be contacted on tax matters.
every two years. With Form CR-16 you must enclose Form CG-
LINE 6: Enter the federal Employer Identification Number
83 and list the serial number, machine manufacturer’s name,
(EIN). If you do not have a EIN but have applied for one,
and physical location for each machine. Cigarette vending
enter “Applied For” and submit the number when received.
machine owners must also have a cigarette vending machine
If you are not required to obtain a EIN (see Other Employer
operator’s master license (no fee required), and a Kansas
Requirements on page 13), enter N/A on line 6.
Retailers’ Sales Tax Registration.
LINE 7: Check the accounting method you will use. See page
– Retail Cigarette/Electronic Cigarette License .
3 for an explanation of these methods.
Engaged in the retail sale of cigarettes and/or electronic
LINE 8: Describe your primary (taxable) business activity and/
cigarettes (In-state and out-of-state retailers).
or principal products sold. Enter the NAICS (North American
All retail cigarette and electronic cigarette dealers, whether
Industrial Classification System) code for your business using
located inside or outside Kansas, are required to have a retail
Pub. KS-1500, available on our website.
cigarette/electronic cigarette license. The license fee is $25 for
LINE 9: If your business is owned by another company, enter
each location and must be renewed every two years. All Kansas
the name, EIN, and complete address of the parent company.
cigarette/electronic cigarette retailers must also have a Kansas
LINE 10: If you are the parent company enter the name, EIN,
Retailers’ Sales Tax Registration; out-of-state retailers must
and complete address of each subsidiary. Enclose a separate
have a Kansas Retailers’ Compensating Use Tax Registration.
list if necessary.
Special rules apply to cigarette sales to Kansas residents over
LINE 11: If you or any member of your firm has ever had a Kansas
the internet, by telephone or mail order; see our Notice 04-04.
tax number, enter that number and/or the business name.
If you are a distributor or manufacturer of consumable
LINE 12: List all registration numbers currently held by the
material, or if you are a retailer who sells consumable material
business.
on which the consumable material tax has not been paid,
LINE 13: List all registration numbers that need to be closed
you must complete and submit Form EC-1, Application for
because of this application.
Consumable Material Tax Registration, to the Department of
LINE 14: If registered with Streamlined Sales Tax (SST), check
Revenue. This form is available on our website.
the “Yes” box and provide your SST identification number.
– Nonresident Contractor . A nonresident business
This number begins with the letter “S.”
engaged in constructing, altering, repairing, or dismantling
real or personal property in Kansas.
PART 4 - LOCATION INFORMATION
Contractors and subcontractors who are not residents of
LINE 1: Enter the name of your business as it is known to the
Kansas must register and be bonded for each contract performed
public.
in Kansas when the total contract price or compensation
LINE 2: Enter the street address for the actual physical location
received is more than $10,000. This registration (PART 11) is
(not a P.O. Box) of your business. If the business is operated
in addition to a Kansas sales and withholding tax registration.
out of a home, use the home address. If the location is a
However, this requirement is waived if a nonresident contractor
rural route, include the rural route box number.
is a foreign corporation authorized to do business in Kansas by
LINE 3: Many cities in Kansas levy a local sales tax; please
the Kansas Secretary of State.
indicate if your physical location is within a city limit, and if
Any nonresident contractor or subcontractor who fails to
so, name the city.
register or comply is not entitled to recover, by way of
LINE 4: Describe your primary business activity at this
Kansas courts, payment for performance of the contract.
location and enter the NAICS (North American Industrial
Failure to register and post the required bond is a misdemeanor
Classification System) code from Pub. KS-1500 on our
offense; upon conviction a nonresident contractor or subcontractor
website. The NAICS code is used to classify businesses
may be fined not less than $100 nor more than $5,000.
according to the type of activity in which they are engaged.
– Water Protection and Clean Drinking Water Fee .
LINE 5: Enter your business telephone number including the
Collected by public water suppliers engaged in the retail
area code at this location.
sale of water delivered through mains, lines, or pipes.
LINE 6: Check whether your business rents or leases motor
The Water Protection Fee is three cents per 1,000 gallons
vehicles for 28 consecutive days or less.
of water. An additional fee for the inspection and regulation of
LINE 7: If your business is a hotel or motel, check yes and enter
public water supplies of $0.002 per 1,000 gallons of water is
the number of sleeping rooms available for rent or lease.
remitted with the Water Protection Fee. The Clean Drinking
LINE 8: Check whether you are a retailer of new tires or if you
Water Fee is three cents per 1,000 gallons sold at retail.
sell new vehicles. If yes, estimate your monthly tire excise
Public water suppliers also need to register with the Kansas
tax liability by multiplying an estimate of the number of new
Department of Health and Environment.
tires sold per month by 25 cents per tire.
LINE 9: If you are a dry cleaner or launderer, check whether you
PART 3 - BUSINESS INFORMATION
have satellite locations or agents in other types of businesses
(grocery store, flower shop, etc.). If yes, enclose a separate
LINE 1: Check the type of ownership. Explanations are on page
sheet listing the name, business activity, and complete
2. If “Other,” identify the type of organization (business trust,
address of each satellite location.
estate, etc.). Corporations: Please provide the date and
LINE 10: Indicate whether or not you are public water supplier
state of incorporation.
making retail sales of water delivered through mains, lines
LINE 2: Enter the legal name of the business. Corporations:
or pipes.
Please provide the corporate name as it is listed in your
5